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Japan’s three largest banks to use stablecoins for cross-border settlements

Author: Content Editor
Japan's largest banks, Mitsubishi UFJ Bank, Sumitomo Mitsui Banking Corporation, and Mizuho Bank, are collaborating on "Project Pax" to utilize stablecoins for faster, cheaper, and 24/7 cross-border payments. The project aims to address issues in the current cross-border transfer market highlighted by the G20, including cost, speed, access, and transparency. By integrating blockchain technology, banks can simplify international money transfers without overhauling their existing systems. The pilot phase is set to launch soon, with a full commercial rollout planned for 2025. The project incorporates regulatory compliance, anti-money laundering, and countering the financing of terrorism regulations. Stablecoins, currently accounting for less than 0.5% of fiat currencies' market cap, have the potential to transform the global economy as a payment method. Stablecoin issuer Tether reported a $4.5 billion profit in Q1 2021, and industry leaders predict stablecoins could make up 10% of the global economy by 2031. Ripple CEO Brad Garlinghouse plans to offer stablecoins in Japan, with the company also launching its own dollar-pegged stablecoins in the US this year.

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